Vishnu Prakash R Punglia Ltd Management Discussions

Economic Environment

Global Economic Overview

In 2024, the global economy experienced modest growth, with real GDP expanding by approximately 3.3%, a performance consistent with that of the previous year. This stability was underpinned by resilient consumer spending in major economies and a gradual easing of inflationary pressures. Advanced economies experienced a slight uptick in growth, while emerging markets maintained robust, albeit slightly decelerated, expansion rates.

However, the economic landscape was marked by significant challenges. Escalating trade tensions, particularly between major economies, introduced uncertainties that dampened investment and trade flows. Geopolitical conflicts and supply chain disruptions further compounded these issues, leading to downward revisions in growth projections for several regions. Notably, Chinas growth was projected to slow to 4.0% in 2025 due to changing trade dynamics, subdued consumer sentiment, and ongoing structural adjustments.

Despite these headwinds, the global economy demonstrated resilience, with inflation rates gradually declining and labour markets robust. Nevertheless, the balance of risks tilted to the downside, emphasising the need for coordinated policy responses to navigate the complex economic environment.

Outlook:

As we look ahead, the global economy stands at a pivotal point. Following an extended phase marked by extraordinary disruptions, signs of stabilisation became evident through much of 2024. Yet, significant policy realignments are reshaping global trade dynamics, reintroducing uncertainty and challenging the resilience of the recovery. While recent developments offer a measure of optimism, fundamental risks persist. The International Monetary Fund (IMF) projects global growth to slow to 2.8% in 2025 and 3.0% in 2026, compared to an estimated 3.3% in January 2025.

Indian Economic Overview

In 2024, the Indian economy demonstrated robust performance amidst global uncertainties. According to the Ministry of Finance, the real GDP growth rate was estimated at 6.4%, aligning closely with the nations decadal average. This was driven by substantial contributions from the services sector (7.2% growth), industrial activities (6.2%), and a rebound in agriculture (3.8%). Private consumption experienced a notable increase, particularly in rural areas, while capital expenditure rose by 8.2% from July to November 2024.

Inflationary pressures eased, with retail inflation averaging 4.9% between April and December 2024, and food inflation stabilising despite earlier volatility. The external sector remained resilient, evidenced by a 12.8% surge in services exports and a 17.9% year-on-year increase in foreign direct investment inflows during the first eight months of FY25. Additionally, foreign exchange reserves reached $640.3 billion by the end of December 2024, sufficient to cover approximately 10.9 months of imports.

Demographic Dividend

India is uniquely positioned to reap the benefits of a demographic dividend. According to EY, its working-age population (15–64 years) is projected to reach approximately 1.04 billion by 2030, accounting for 69% of the total population. This shift is expected to lower the dependency ratio to just 31.2%, creating a powerful engine for economic productivity. With a median age of 28.4 years, India remains significantly younger than most developed nations, where median ages often exceed 40. Importantly, India is anticipated to contribute approximately 25% of the global incremental workforce over the next decade, as ageing populations in other economies constrain labour supply. Building on this potential, women constitute 49% of higher education enrollments, indicating a positive trend toward increased female workforce participation.

Expanding Middle Class

Indias middle class is poised for a significant expansion, projected to grow from 31% of the population in 2020-21 to 61% by 2046-47, reaching approximately 1.02 billion individuals. This growth is expected to be a major driver of economic development, as the middle class contributes substantially to income, expenditure, and savings. The increase is attributed to rising incomes, urbanisation, and improved access to education and technology. Notably, the number of ‘Super Rich households, earning more than 2 crore annually, has nearly doubled to 1.81 million in five years through 2021, with projections indicating further increases. The expansion of the middle class is anticipated to transform India into a global consumption powerhouse, with significant implications for various sectors, including housing, education, and healthcare.

Rapid Urbanisation:

According to the World Bank, India is undergoing a significant urban transformation, with projections indicating that by 2036, approximately 600 million people, about 40% of its population, will reside in urban areas, up from 31% in 2011. Urban regions currently account for nearly 70% of the nations GDP, underscoring their pivotal role in economic development. To accommodate this rapid urbanisation, India faces the challenge of constructing almost 70% of the urban infrastructure required by 2047. Addressing this need will necessitate substantial investments, estimated at $840 billion by 2036, averaging $55 billion annually or 1.2% of the GDP.

Manufacturing and Industrial Growth

Indias manufacturing sector is experiencing strong momentum, driven by strategic initiatives such as the Production Linked Incentive (PLI) schemes and the ‘Make in India initiative. As of March 2025, the PLI scheme has approved 764 applications across 14 sectors, resulting in 1.61 lakh crore in investments and generating employment for approximately 11.5 lakh people. Between April 2014 and March 2024, India attracted a record $667.41 billion in FDI, accounting for nearly 67% of total FDI received over the past 24 years. Complementary programmes like PM GatiShakti and the National Logistics Policy further boost infrastructure and efficiency, reinforcing Indias emergence as a global manufacturing hub.

Robust Capital Markets

Indias capital markets are exhibiting robust growth, underscored by significant activity in both equity and debt segments. In the first quarter of 2025, India secured a 22% share of global IPO activity, with 62 companies raising a total of US$2.8 billion. This performance positions India among the top IPO markets globally, reflecting strong investor confidence and a healthy pipeline of companies preparing to go public. Parallel to this, the Indian bond market has expanded to a valuation of US$2.69 trillion as of December 2024, with the corporate bond segment alone surpassing US$602 billion. This growth indicates a shift towards debt-driven financing, supporting Indias ambition to become a US$7–8 trillion economy within the next five years. The concurrent expansion of equity and bond markets underscores Indias evolving financial ecosystem, characterised by increased investor participation and diversified funding avenues.

Digital Transformation:

Indias digital transformation has accelerated remarkably, positioning the nation as a global leader in digital innovation. As of mid-2024, India boasts over 950 million internet subscribers and more than 650 million smartphone users, fuelling growth in e-commerce, digital payments, and fintech sectors. The Unified Payments Interface (UPI) exemplifies this surge, processing over 23.24 lakh crore in transactions in December 2024 alone, a dramatic increase from 707.93 crore in December 2016. Indias digital economy contributed 11.74% to the countrys GDP in 2022-23, amounting to 31.64 lakh crore (approximately USD 402 billion), and is projected to reach nearly 20% by 2029-30. Digital Public Infrastructure (DPI) initiatives, such as Aadhaar and DigiLocker, have further enhanced digital inclusion, with Aadhaar issuing over 1.38 billion IDs and DigiLocker facilitating access to 9.4 billion documents for 434.9 million users.

Policy Reforms:

Strategic policy reforms underpin Indias economic ascent, fostering inclusive growth, enhancing competitiveness, and attracting investment. The Union Budget 2025–26 introduced significant tax reforms, including raising the tax-free income threshold to 1.2 million under the new regime, stimulating consumption and relieving middle-income earners. The government launched the National Manufacturing Mission to bolster the manufacturing sector, focusing on integrating India into global value chains, supporting sector-specific industrial clusters, and reducing cost disadvantages for manufacturers. In the defence sector, 2025 has been designated as the "Year of Defence Reforms," emphasising the establishment of integrated theatre commands and the adoption of emerging technologies such as artificial intelligence and robotics.

Outlook:

Amid evolving global developments and recent trade and tariff-related uncertainties, Indias domestic economy shows stability and resilience. RBIs Industrial Outlook Survey highlights improved production, stronger order books, and better capacity utilisation. Consumer sentiment has also shown improvement, with indicators such as higher GST collections and increased E-way bill generation suggesting steady growth in economic activity. Given the global uncertainties, the RBI has recently pegged the real GDP growth rate for FY25 at 6.5%, downgrading it by 20 basis points. The IMF has also revised its growth forecasts for the Indian Economy by 30 basis points, now pegging it at 6.2%.

Industry Overview

India, now the worlds most populous country, is poised to witness a demographic shift with significant economic consequences. By 2030, the nation is expected to have approximately 1.04 billion people in the working-age group (15–64 years), making it the largest workforce globally. This population surge will necessitate substantial infrastructure investments to meet the growing demands for water, housing, transportation, sanitation, and urban services. Both public and private sector involvement will be crucial to developing resilient infrastructure that supports sustainable urbanisation, inclusive growth, and economic productivity.

Infrastructure

As per the India@100 report by EY, India is projected to become a US$26 trillion economy. Achieving this vision will hinge significantly on infrastructure development, a critical enabler of growth. Strategic investments in expanding and modernising physical infrastructure, aligned with initiatives to improve business ease, are essential for enhancing operational efficiency and reducing costs. The government has firmly committed to future-ready infrastructure through multiple recent initiatives. Emphasising the critical role of infrastructure in economic expansion, Knight Frank India estimates that India will require an investment of USD 2.2 trillion to achieve its target of becoming a USD 7 trillion economy by 2030.

India has witnessed transformative progress in infrastructure over the past decade, laying a solid foundation for sustained economic growth. Total infrastructure spending has grown, with budgetary outlays reaching 10 lakh crore in FY2023–24. The PM Gati Shakti National Master Plan has emerged as a pivotal initiative, aligning 44 Central Ministries and 36 States/UTs for integrated planning and execution. By November 2024, it had assessed 208 key infrastructure projects worth over 15.39 lakh crore, supporting seamless multimodal connectivity.

On-ground execution has kept pace with policy ambition. The National Highway network expanded from 65,569 km in 2004 to 146,145 km in 2024, with construction speed improving to 33.8 km/day in FY 2023–24. Under the Bharatmala Pariyojana, over 18,926 km of roads were completed. In parallel, the government has initiated the development of 35 Multimodal Logistics Parks with a combined investment of 46,000 crore to boost supply chain efficiency. Rural infrastructure has seen equal focus; 7.72 lakh km of roads have been built under the Pradhan Mantri Gram Sadak Yojana, enhancing last-mile connectivity across villages.

To further propel this infrastructure-led growth trajectory and align with the long-term vision of Viksit Bharat @ 2047, the Union Budget 2025–26 allocated a record 11.21 lakh crore towards infrastructure development. In her eighth consecutive budget, the Honble Finance Minister, Ms. Nirmala Sitharaman, also introduced tax and policy reforms to encourage greater private sector participation. These measures reflect a forward-looking strategy focused on building a resilient, modern, and inclusive infrastructure ecosystem, critical to supporting Indias economic ambitions in the decades ahead.

Roads and Highways

Indias roads and highways sector has witnessed transformative growth over the past decade, evolving into a critical economic activity and a key enabler of connectivity. With a total length of approximately 6.7 million kilometres, India now boasts the second-largest road network in the world, having expanded by 59% over the last decade. This vast network handles 64.5% of the countrys freight movement and facilitates nearly 90% of total passenger traffic, underscoring its pivotal role in national mobility. As of December 2024, India had developed 146,195 kilometres of National Highways and established 2,474 National High-Speed Corridors, enhancing regional and inter-state connectivity.

In FY24 alone, the country constructed 12,300 kilometres of National Highways, and 3,100 kilometres were awarded during FY25 (up to December). Additionally, 202 National

Highway projects, spanning 6,270 kilometres and valued at 79,789 crore (US$9.59 billion), are currently under implementation. Reflecting the governments continued infrastructure push, the Union Budget 2025–26 allocated 2,87,333.3 crore (US$33.07 billion) to the Ministry of Road Transport and Highways, a 2.41% increase over the previous year, solidifying its commitment to strengthening road infrastructure as a driver of inclusive and sustainable growth.

Complementing this large-scale development is the Bharatmala Pariyojana, a flagship programme launched in 2017 to enhance road connectivity and reduce logistics costs across the country. As of 31^st October 2024, projects spanning 26,425 kilometres have been awarded under Phase I, out of which 18,714 kilometres have already been constructed. The scheme, implemented without state-wise fund allocation, has incurred a cumulative expenditure of 4.72 lakh crore by the National Highways Authority of India (NHAI) as of November 30, 2024. Additionally, 18 projects covering 424 kilometres have been awarded under the Port and Coastal Connectivity Roads category, with 189 kilometres completed to date. These projects significantly enhance access to primary and minor ports across coastal states, including Gujarat, Maharashtra, Tamil Nadu, and Andhra Pradesh, thereby further supporting multimodal logistics and regional trade.

Railway and Metro

Indias railway network, one of the largest and most utilised globally, continues to serve as a backbone of the countrys transportation infrastructure. Spanning over 68,000 route kilometres, Indian Railways facilitates the movement of more than 8 billion passengers annually and transports over 1.5 billion tonnes of freight, making it a vital enabler of national connectivity and economic activity. The Government of India has steadily increased capital investment to modernise infrastructure, enhance safety, and improve operational efficiency.

Under the Union Budget 2025–26, Indian Railways received a record allocation of 2.55 lakh crore, aimed at completing priority projects, including new lines, doubling, electrification, station redevelopment, and the procurement of modern rolling stock. Key initiatives include the rollout of Vande Bharat trains across multiple routes, the implementation of Kavach, an indigenously developed train protection system, and the expansion of Dedicated Freight Corridors (DFCs) to decongest passenger routes.

The urban mobility landscape is also undergoing a rapid transformation, with metro rail systems now operational or under development in over 20 Indian cities. As of December 2024, India has over 950 km of operational metro rail across major urban centres, with another 1,000+ km under various stages of planning or execution. The National Metro Rail Policy promotes standardisation, private participation, and last-mile connectivity, enabling metros to become key drivers of sustainable urbanisation.

Water supply and wastewater management

India is home to nearly 18% of the global population, yet it possesses only 4% of the worlds freshwater resources, leading to acute water stress across several regions. Public and private sector stakeholders are developing comprehensive plans to expand water supply, wastewater treatment, and distribution infrastructure to meet the growing demand for safe and reliable water. As urbanisation accelerates and environmental standards tighten, the demand for advanced water treatment technologies is rising rapidly, reflecting the countrys shift toward more sustainable and resilient water management solutions.

Building upon the pressing need for advanced water management solutions, Indias water and wastewater treatment market is experiencing significant growth. According to BlueWeave Consulting, the market is projected to expand at a compound annual growth rate (CAGR) of 10.05%, reaching a valuation of USD 3.03 billion by 2029. This surge is driven by increasing urbanisation, stringent environmental regulations, and heightened awareness of water conservation. The municipal segment dominates the market, reflecting the governments emphasis on providing safe drinking water and effective sewage treatment in both urban and rural LIMITED areas. Technological advancements, such as membrane

separation and biological treatment processes, are being increasingly adopted to enhance efficiency and sustainability in water treatment practices.

The government has undertaken multiple national-level initiatives to strengthen core infrastructure and tackle pressing environmental and public health concerns. Launched in 2019, the Jal Jeevan Mission aims to provide every rural household with safe and adequate drinking water through the installation of functional tap connections. Alongside this, programmes such as the Atal Mission for Rejuvenation and Urban Transformation (AMRUT), the National Mission for Clean Ganga (NMCG), and various Community Drinking Water Schemes are playing a pivotal role in expanding water access and improving wastewater treatment capacity, thereby driving the growth of the countrys water and sanitation sector.

Jal Jeevan Mission:

Launched in August 2019, the Jal Jeevan Mission (JJM) is a flagship initiative of the Government of India aimed at providing safe and adequate drinking water through individual tap connections to all rural households. At its inception, only about 16.7% of rural households had access to tap water. As of March 17, 2025, this figure has risen significantly, with approximately 80.2% of rural households, equating to over 15.53 crore homes, now having tap water connections. States and Union Territories such as Goa, Telangana, Andaman & Nicobar Islands, Puducherry, Dadra & Nagar Haveli and Daman & Diu, Haryana, Punjab, Gujarat, Himachal Pradesh, and Mizoram have achieved 100% coverage under the mission.

The mission emphasises community involvement, with over 5.24 lakh Village Water & Sanitation Committees (VWSCs) formed to manage and maintain water supply systems. Additionally, more than 21 lakh women have been trained to conduct water quality testing using Field Test Kits, ensuring the safety and sustainability of water sources. In fiscal 2024-25, 1.68 crore drinking water samples were evaluated across laboratories using Field Test Kits to monitor water quality. The missions initial estimated outlay was 3.60 lakh crore, with the central share being 2.08 lakh crore. Recognising the need for continued efforts, the government has extended the mission until 2028 with an enhanced total outlay, reaffirming its commitment to ensuring safe drinking water for all rural households.

Atal Mission for Rejuvenation and Urban Transformation (AMRUT)

Launched on October 1, 2021, the Atal Mission for Rejuvenation and Urban Transformation (AMRUT) 2.0 aims to make Indian cities ‘water secure and self-reliant by providing universal coverage of water supply through functional taps to all households in statutory towns and comprehensive sewerage and septage management in 500 AMRUT cities. With a total indicative outlay of 2.99 lakh crore, including a central share of 76,760 crore over five years, the mission emphasises the development of City Water Balance Plans (CWBP) to promote the circular economy of water, focusing on recycling treated sewage, rejuvenating water bodies, and conserving water resources.

As of November 15, 2024, the Ministry of Housing and Urban Affairs has approved 8,998 projects worth 1.89 lakh crore under AMRUT 2.0, with contracts awarded for 4,916 projects totalling 85,114 crore. Out of the admissible central assistance of 63,976.77 crore, 11,756.13 crore has been released to States and Union Territories, with reported utilisation of 6,539.45 crore. Cumulatively, including the States share, the total expenditure reported is 17,089 crore, and works worth 23,016.30 crore have been physically completed.

AMRUT 2.0 also includes components like Pey Jal Survekshan to assess equitable water distribution and reuse, a Technology Sub-Mission to leverage global innovations in water management, and Information, Education, and Communication (IEC) campaigns to raise public awareness about water conservation.

The National Mission for Clean Ganga (NMCG)

In April 2025, the National Mission for Clean Ganga (NMCG) approved several key projects totalling over 900 crore to enhance river conservation efforts. These include a 409.93 crore initiative in Moradabad, Uttar Pradesh, aimed at preventing pollution in the Ramganga River by constructing an 80 MLD sewage treatment capacity and diverting five major drains. In Arrah, Bihar, a 328.29 crore project will establish a 47 MLD sewage treatment plant and a 19.5 km sewer network under the Hybrid Annuity Model.

Kanpurs drainage system will be upgraded with a 138.11 crore project intercepting 14 untapped drains. Additionally, a 5.96 crore faecal sludge treatment plant is planned for Pujali Municipality, West Bengal. Innovative approaches include piloting CAMUS-SBT plants for treating pollutants in Delhis Shahdara drain and establishing the IND-RIVERS Collaboratory with IIT Delhi and Dutch partners to focus on intelligent river systems and clean Yamuna initiatives. Furthermore, DDA Biodiversity Parks will serve as knowledge and skill development centres to promote sustainable water management practices.

Business Overview

Company Overview

Established in 1986, Vishnu Prakash R Punglia Limited (VPRPL) has emerged as one of Indias fastest-growing infrastructure development companies. Rooted in customer-centric values and a commitment to engineering excellence, the company evolved from a partnership firm into a joint stock company in 2013 and today stands as a trusted EPC contractor for critical public infrastructure. VPRPLs consistent focus on innovation, execution capability, and high-quality delivery has enabled it to play a vital role in building Indias physical backbone, spanning water, rail, roads, and urban infrastructure.

water supply schemes, railway infrastructure, roads, and urban civic development. The company continues to witness healthy order inflow momentum, with multiple contracts secured during the year, including high-value projects from BHEL, Northwestern Railway, Jaipur Development Authority, U.P. Jal Nigam, and others. VPRPL also secured joint venture orders, reflecting growing collaborative participation in large-scale, multi-disciplinary projects. Notably, the company has been strategically expanding beyond its traditional stronghold of Rajasthan into states such as Uttar Pradesh, Goa, Chhattisgarh, and Madhya Pradesh.

A strong culture of professionalism, integrity, and transparent governance underpins every aspect of VPRPLs operations. Its leadership continues to drive excellence by adopting modern construction technologies, digital project monitoring, and sustainable practices that align with the evolving expectations of its stakeholders. With a future-ready mindset, VPRPL is well-positioned to scale its operations by entering new geographies, diversifying into complementary infrastructure sectors, and strengthening its client base while upholding its core values of precision, reliability, and nation-building.

Financial Overview:

Particulars	2024-25	2023-24	% Change
REVENUE FROM OPERATIONS	12374	14739	-16.05%
Total expenses	10819	12640	-14.41%
EBITDA	1554	2099	-26.00%
EBITDA Margin (%)	12.56%	14.24%	- 168 bps
Depreciation and amortisation	159	112	41.96%
Finance costs	678	430	57.67%
Other Income	88	88	0.00%
PBT	805	1645	-51.06%
PBT Margin (%)	6.51%	11.16%	- 465 bps
Tax	219	423	-48.23%
PAT	586	1222	-52.05%
PAT Margin (%)	4.74%	8.29%	- 355 bps
Other Comprehensive Income	-3.51	0	NA
Total Comprehensive Income	582	1222	-52.37%
Diluted EPS	4.7	10.95	-57.08%

Financial Performance Analysis:

In FY2024–25, Vishnu Prakash R Punglia Limited experienced a moderation in financial performance, primarily driven by execution delays and elevated cost pressures. Revenue from operations stood at 12,374 million, marking a 16.05% year-on-year decline from 14,739 million in the previous year. The primary factor behind this decline was persistent delays in client payments, which constrained cash flows, impacted the execution timeline, and ultimately reduced billings.

Total expenses also declined by 14.41% to 10,819 million, in line with the lower activity levels. However, EBITDA dropped 26.00% to 1,554 million, resulting in a 168-bps contraction in EBITDA margin, from 14.24% in FY24 to 12.56% in FY25. On the profitability front, the company faced pressure from higher finance costs, which surged 57.67% year-over-year to 678 million due to increased working capital borrowings, and higher provisioning undertaken to manage execution-related uncertainties and mitigate future risks.

Consequently, Profit Before Tax (PBT) dropped by 51.06% to 805 million, with PBT margin contracting by 465 basis points. Net profit (PAT) stood at 586 million, down

52.05%, with PAT margin declining to 4.74% compared to 8.29% in FY24.

Despite these temporary setbacks, the company remains confident in its long-term fundamentals. Backed by a robust order book and L1 positions and supported by sustained government thrust on infrastructure through extended schemes and increased budgetary allocations, management expects a significant improvement in execution and financial performance in the upcoming quarters.

During FY2024–25, the company secured new orders totalling 18558.71 million across key segments, including railways, water supply, and other infrastructure sectors, underscoring its strong market position and continued business momentum. As of 31^st March 2025, the total unexecuted order book stood at approximately 53,634 million, offering healthy revenue visibility for the forthcoming years. Internally, the company remains focused on enhancing operational efficiency through robust process integration and stringent cost controls. Continued investments in critical infrastructure, such as in-house manufacturing facilities, advanced testing laboratories, and project support systems, are aimed at ensuring timely execution, improving delivery capabilities, and safeguarding margins.

Key Ratios
Particulars	2024-25	2023-24	YoY Change
Inventory turnover ratio (x)	1.55	3.11	-1.56x
Current ratio (x)	1.51	1.70	0.19x
Debt Equity ratio (x)	0.91	0.55	0.36x
Return on Capital Employed (%)	11.40	24.58	1318 bps
Return on Equity (%)	7.81	23.60	1579 bps

SWOT Analysis

Strengths

Established Presence in Rajasthan and Growing National Footprint

VPRPL is well-recognised in the Water Supply Projects (WSP) segment, particularly in Rajasthan, where it has established strong execution credentials and long-standing client relationships. While the companys initial operations were regionally focused, it has expanded its presence to 11 states. As of March 2025, VPRPL has a project portfolio comprising 61 projects, with 38 located in Rajasthan and 23 spread across other regions, highlighting its successful geographical diversification.

Specialisation in WSP and Rail Projects

The company has developed deep domain expertise over 30 years in infrastructure EPC, specialising in water supply and railway infrastructure projects. Its execution model is supported by a fleet of over 500 construction equipment units and an entirely in-house team, eliminating dependence on third-party contractors. As of 31^st March 2025, water sanitation programs contribute approximately 75% of the companys topline, accounting for 74% of the order book.

Integrated In-house Execution Model

A key operational strength lies in VPRPLs integrated approach to project execution. The company owns and maintains a vast equipment fleet, executing all projects using its internal resources. This not only improves cost control and project timelines but also ensures quality assurance across all stages of construction.

Visible and Sustained Growth Trajectory

VPRPLs growth is evident through a robust and expanding order book, valued at 53,634 million as of March 31, 2025. In FY25, the company completed eight projects worth 7,080 million, spanning diverse infrastructure verticals across India. This execution strength reflects strong client trust and operational resilience.

Strategic Focus on EPC Projects

VPRPL maintains a strategic focus exclusively on Engineering, Procurement, and Construction (EPC) contracts. This targeted approach enables more effective risk management and better control over working capital.

Weaknesses

Execution Risk and Project Concentration

While VPRPL has built strong capabilities, its project portfolio remains significantly concentrated on water infrastructure. Although this segment offers long-term visibility, it is also subject to execution complexities due to its large-scale, multi-phase nature. However, the companys deep familiarity with regulatory environments in Rajasthan and other states helps mitigate this risk. Notably, most government WSPs accommodate delays caused by external factors, offering some operational flexibility. Nonetheless, the timely execution of ongoing and nascent projects remains critical from a financial and credit perspective.

Intense Competitive Landscape

The EPC sector remains highly fragmented and competitive. Contracts are awarded based on technical experience, financial strength, and the lowest bid criteria. VPRPL faces pricing pressure from established infrastructure players and regional contractors, particularly in central and state-funded tenders. While government projects offer reliable payments and lower credit risk, they attract aggressive bidding, which can compress margins and affect project profitability.

Opportunities

Strong Government Commitment to Infrastructure Development

India continues to witness unprecedented policy and budgetary support for infrastructure development. In the Union Budget 2025–26, the government allocated a record 11.21 lakh crore towards capital expenditure, underlining its sustained focus on infrastructure-led growth. This historic allocation reflects the Centres commitment to building resilient, future-ready infrastructure across transport, water, urban, and logistics sectors.

Jal Jeevan Mission Extension and Enhanced Outlay

One of the key pillars of this infrastructure push is the Jal Jeevan Mission, which aims to provide every rural household with a functional household tap connection. The mission has now been extended until 2028 to ensure 100% coverage, with an enhanced total financial outlay, offering long-term project visibility for contractors like VPRPL, which has deep water supply infrastructure expertise. This extension provides a strong pipeline of state-funded water projects across India, where VPRPL is already a pre-qualified and experienced player.

Healthy and Diversifying Order Book

As of March 31, 2025, the company had a robust order book of 53,634 million. The order book continues to diversify across segments, including railways, roads, and geographies, thereby reducing reliance on any single vertical or state.

Established Client Network and Industry Experience

With three decades of experience, the promoters have cultivated deep institutional relationships with key government departments. VPRPLs proven record in timely and quality execution strengthens its brand equity and enables participation in more complex, high-value tenders.

Threats

Project Complexity and Execution Risk

Large infrastructure projects often involve multiple stakeholders, complex logistics, and numerous external dependencies, ranging from land acquisition to interdepartmental clearances. While VPRPL has strong internal project management practices, any systemic delay can affect timelines and revenue recognition, especially in early-stage contracts.

Policy and Political Uncertainty

Infrastructure policy, environmental norms, or changes in political administration may delay project approvals or alter funding priorities. While Indias overall infrastructure trajectory remains positive, unforeseen shifts in public policy at either the central or state level could pose risks to order inflow and execution schedules.

Regulatory Approvals and Environmental Compliance

Infrastructure development faces regulatory challenges, including environmental approvals, forest clearances, and land acquisition bottlenecks. Delays in obtaining statutory clearances could escalate project costs and timelines. Efficient coordination with government agencies remains crucial to mitigate these risks.

Internal Controls & Compliance

Vishnu Prakash R Punglia Limited (VPRPL) maintains a robust internal control framework to ensure operational efficiency, safeguard assets, and support compliance with applicable laws and regulations. The system is structured around a clearly defined delegation of authority matrix, ensuring accountability and effective decision-making across all levels.

Each functional department operates under documented Standard Operating Procedures (SOPs) that are periodically reviewed and updated to ensure compliance with current regulations and best practices. The company also adheres to detailed accounting and reporting guidelines to ensure consistency and compliance with relevant laws and regulations.

A comprehensive internal audit programme by independent professional firms covers all primary operational and financial functions. These audits assess the adequacy of internal controls and recommend improvements, which are closely monitored by functional leadership. The company also regularly assesses its Internal Financial Controls (IFC), focusing on risk mitigation, transaction accuracy, and process discipline.

VPRPL is further in the process of integrating ERP-based systems to enhance transparency and oversight. This digital integration automates key processes and enables real-time monitoring of financial and operational data. It supports tighter control over project-level activities and cash flow management.

The Audit Committee of the Board oversees all control-related matters and ensures that auditor recommendations are implemented promptly and effectively. VPRPL remains committed to continuously strengthening its control environment to support sustainable and compliant growth.

Risks and Concerns

VPRPL operates in a dynamic and regulated environment where timely risk identification, assessment, and mitigation are critical for sustained performance. The Company has implemented a formal risk management framework in accordance with SEBI Regulations and Companies Act requirements and established a dedicated Risk Management Committee for periodic review and oversight.

The key risks identified by the Company, along with their potential impact and mitigation strategies, are outlined below:

Human Resources

At VPRPL, human capital remains a cornerstone of sustainable growth and successful project execution. The company continues to invest in developing a skilled, motivated, and agile workforce that can respond effectively to the evolving demands of the infrastructure sector.

During FY2024–25, VPRPL intensified its focus on capability enhancement by conducting a structured calendar of technical and behavioural training sessions across functions and project sites. These programmes were designed to improve on-site efficiency, ensure compliance with safety and quality protocols, and strengthen leadership at all levels.

The company remains committed to fostering a high-performance culture by aligning individual goals with organisational objectives. Employee engagement initiatives, including leadership connect sessions, feedback forums, and wellness programmes, were conducted to strengthen organisational alignment and workplace satisfaction.

VPRPL continued its structured performance appraisal framework to recognise and reward excellence, complemented by incentive-linked recognition programmes to honour outstanding contributions. This has helped build a culture of ownership, accountability, and continuous improvement.

Looking ahead, the company aims to further reduce attrition by enhancing career development pathways, supporting work-life balance, and reinforcing a positive and inclusive work environment. As of March 31, 2025, VPRPL had a total workforce of 1,454 employees, reflecting both business expansion and its commitment to building internal capabilities.